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Are You Eligible For Income Tax Rebate U/S 87A


Jun. 14

INCOME T A X A RT ICLES

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3 comment s

In budget 2013-14, t axpayers focus w as on Sect ion


87A . T his sect ion is added in Income T ax act 1961
for t he benefit of common man. Sect ion 87A st at es
t hat t axpayer w it h an income of less t han 5 lakhs w ill
be eligible t o get a t ax rebat e of Rs. 2,000.

Please understand clearly, it is a tax rebate


and not an exemption.
It w ill be available t o individual assessee falling under
cat egory of general and senior cit izen only. No HUF
w ill receive t his rebat e.
How To Calculat e Tax Rebat e U/S 87A ?
T his t ax rebat e w ill be available t o t hose w hose
income is less t han Rs. 5 lakhs and fall under t he
above-ment ioned cat egory. Here income means gross
income minus deduct ions under sect ion V I. If your
net income is below Rs. 5 Lakh, you w ill receive a
relief of Rs. 2,000 in your t ot al t ax payment s.
Example
Suppose you are a general cit izen w it h a salary Rs. 5 Lakhs. Y ou get deduct ions of Rs. 50000 under Sec
V I. Hence, now net income is Rs. 4,50,000 t hat means you are liable t o receive t his rebat e. Y our act ual
t ax payment for FY 2013-14 for t he above income w ill be as under.
T ax plus 3% surcharge = Rs. 25,750

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T ax payable aft er rebat e = Rs. 23,750

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Y ou dont need t o do any procedure for t his. Y our rebat e w ill be deduct ed w hen you file your ret urns.
Sect ion VI
T here are many deduct ions available t o individuals under Sect ion V I. It includes invest ment s and cert ain
expenses.

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Not exceed Rs.

Not exceed Rs.

1,00,000 in total

1,00,000 in total

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Pension plan from

insurance companies
80CCD

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assessee?

Contribution for Pension

A ll about capit al gains t ax

plan by Central Government

A n assessee cannot be deprived of credit for T DS


due t o any anomaly in Form 26A S filed by his
deduct or

employees
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Medical insurance

premium (family members

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A re Y ou Eligible For Income T ax Rebat e U/S 87A

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Rs. 1,00,000

Rs. 1,00,000

Rs. 50,000

Rs. 50,000

Tw eet

T ags: income t ax ret urns, Sect ion 87A , T ax rebat e, t ax ret urn
Invest ment in Family Members Name Can Help in
T ax Planning

Personal Finance Changes A s Per Budget 2013-14

T axabilit y of income from shares


How t o file t he income t ax ret urn of a deceased
assessee?
A ll about capit al gains t ax
A n assessee cannot be deprived of credit for T DS
due t o any anomaly in Form 26A S filed by his
deduct or
Capit al Gain on depreciable asset s held for more
t han t hree years should be t reat ed as long t erm
capit al gain for det ermining t he rat e of t ax

3 Comments

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g v waran

6 months ago

this is wrong calculation under section 87 A


10 % of net income - rebate Rs.2000
from the total tax after rebate
then 3 % cess
total
clarify
6

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Rajat Kanti Sinha

9 months ago

this is wrong information, in 87A nowhere it is mentioned about age limit i.e senior citizen
Reply Share

Prabhakar Malgate

a year ago

Plz read as " Chapter VI " wherever Section VI.


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